Short-term Long-term advice assignment 代写
Hi John,
Below is my draft plan for John and Davina for your reference. Could you give me some advices?
Please note that the figures regarding super are all today's dollars. Inflation has already been taken into consideration since my super strategy is a 2 steps plan. The AMP SIMULATOR has its limitation, so in super strategy step 2, I have already divided the future values by inflation rate. I also used Excel financial formulars to calculate their managed fund future value.
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Short-term (1-2 years)
1. For John, switch his super into AMP Flexible Super Choice.
2. For Davina, increase her inside super investment risk level. Switch her super into Cbus Industry Super.
3. When the term deposit matures, use $10,000 of it to pay off part of credit card. According to the cash flow report, they have a $38,513 annual surplus. Try to pay off the rest of the credit card within 2 years.
4. For John, consolidate $120,000 of his share portfolio ($150,000 in total) into super, and use $30,000 to pay off Davina’s car loan. This will save him $7,365 unnecessary interest spending. Consolidate it before 1 July 2017.
5. Keep the rest $10,000 in bank account as an emergency fund. Their credit cards limit can serve as emergency fund as well.
6. When Davina goes back to work, make extra repayments to home loan. Monthly repayment will increase to $2,824. ($27,882 p.a.), targeting to pay it off in 15 years.
Medium-term (2-5 years)
1. Hire a power attorney and issue a will.
2. Start an annual saving plan after Davina goes back to work. They have an annual surplus of $60,289 according to the fact find.
3. Put surplus into AMP CAPITAL MULTI-ASSET FUND to create wealth. This fund’s projected net return is 4.65% and distribution frequency is quarterly. Inject $30,000 p.a. into it under Davina’s name one year after Davina goes back to work. 4 years after that, it will produce a $131,052 (future value) balance.
Long-term (5+ years)
For John:
1. When John is 55, start salary sacrificing $10,000 p.a. into super. Consolidate $100,000 of managed fund (under Davina’s name) into super. When John retires at age 65 his super balance will be $850,500 which can generate a $48,100 pension income.
2. When John reaches age 60, start Transition to Retirement. As he is already contributing the highest amount to super before tax, TTR will not help him save income tax. But we can still use re-contribution strategy, which switches his taxable component into tax free component.
For Davina:
1. Start salary sacrificing $7,000 p.a. to super when she is 55. When she retires at age 60 her super balance will be $372,000 which can generate a $20,000 pension income.
For John &Davina:
1. They are not eligible for age pension.
2. When John retires (65), their family annual surplus will decrease to $29,353. They can stop managed fund saving plan. The balance is $428,496 (future value).
3. When Davina retire at age 60, John is 74. They can generate $68,100 annual pension income and enjoy a comfortable retirement. They also have $649,607 (future value) balance in managed fund.
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Thanks and have a good weekend!
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Tingyin Huang
Short-term Long-term advice assignment 代写
